Trade: Long GBP/USD @ 1.4400

I have opened a position on the GBP/USD @ 1.4400 with another order to open at 1.4330 with an upside target of 1.500 and a stop loss at 1.4200.

Sentiment:

This is a risky trade given the uncertainty of a Brexit but I think this pair is in a deep retracement. I have opted to open the trade after the last FOMC meeting and dot plot only suggesting 2 hikes this year from the Federal Reserve . This has halved from their forecasted 4 hikes in the December meeting. Fundamentally the USD is still the strongest currency in my books but I think it is a big wave that built and broke through 2015 and now naturally needs to retrace.

Technical:

I have positioned my entries on minor pullbacks of the last leg higher seen last week after the BOE stated that the next move for them is still a hike and not a cut, which some analysts were speculating. I have placed a stop below the last minor leg higher and the monthly pivot point where some buy orders should support the pair if sentiment stays the same. 1.5000 is a big handle that was broken at the beginning of the year so there should be some selling pressure around that area which is why I have opted to take potential profits here.

Risk:

This trade is a riskier one I believe given the volatility of the Brexit. I also believe that is the US keeps seeing strong data as it has been it may be forced to re-look at the number of hikes this year. Hopefully the US economy will slow with the weaker global growth forecasts which will confirm the dot plots forecast for less hikes in 2016.